NEW YORK (

TheStreet

) --

Berkshire Hathaway

(BRK.A) - Get Report

, one of

Kraft's

( KFT) largest shareholders, announced on Tuesday that it is objecting to Kraft's proposal to issue up to 370 million shares to help fund its acquisition of Cadbury.

Berkshire says it currently owns 138.3 million Kraft shares, or 9.4% of Kraft shares outstanding, making it the company's largest shareholder. Berkshire, led by investor

Warren Buffett

, says it believes that if the proposal goes through, Kraft will be given a "blank check" to change its offer for Cadbury "in any way it wishes" from the transaction presented to shareholders in the proxy statement.

"We worry very much that, indeed, there will be an additional change from the revision announced this morning," the company said it a statement.

Berkshire adds that it knows with certainty that Kraft stock, at its current price of $27, is a very expensive "currency" to be used in an acquisition. It says that in 2007 Kraft spent $3.6 billion to repurchase shares at about $33 per share, "presumably because the directors and management thought the shares to be worth more."

Kraft has until Jan. 19 to present

Cadbury

( CBY) with a final offer, which Berkshire says it will support only if it knows for sure that the deal won't destroy shareholder value.

On Tuesday, Kraft's

presumed rival bidder

Nestle

(NSRGY) - Get Report

issued a statement confirming that it is in no way angling to make Cadbury an offer. Instead, this morning Nestle announced that it would buy Kraft's North American pizza business for $3.7 billion, arming Kraft with additional firepower to sweeten its bid for Cadbury.

According to reports, Kraft will use the proceeds to increase the cash factor of the offer by about 60 pence per Cadbury share.

Kraft originally offered Cadbury 300 pence in cash and 0.2589 Kraft shares in exchange for each Cadbury share.

-- Reported by Andrea Tse in New York

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